What is Beta of a Stock? What is the expected return of a stock according to...

What is Beta of a Stock? What is the expected return of a stock according to the CAPM model?

Expert Solution

jeff jeffy answered 3 years ago

A stock has an expected return of 0.08, its beta is 1.5, and the expected return...

A stock has an expected return of 0.08, its beta is 1.5, and the expected return on the market is 0.1. What must the risk-free rate be? (Hint: Use CAPM) Enter the answer in 4 decimals e.g. 0.0123.

A stock has an expected return of 0.13, its beta is 1.44, and the expected return...

A stock has an expected return of 0.13, its beta is 1.44, and the expected return on the market is 0.09. What must the risk-free rate be? (Hint: Use CAPM) Enter the answer in 4 decimals e.g. 0.0123. You own a portfolio equally invested in a risk-free asset and two stocks (If one of the stocks has a beta of 1 and the total portfolio is equally as risky as the market, what must the beta be for the other...

Stock J has a beta of 1.5 and an expected return of 15%, while Stock K has a beta of .75 and an expected return of 9%.

Stock J has a beta of 1.5 and an expected return of 15%, while Stock K has a beta of .75 and an expected return of 9%. You want a portfolio with the same risk as the market. What is the expected return of your portfolio?Group of answer choices10 percent11 percent12 percent13 percent14 percent

A stock has an expected return of 12.66 percent. The beta of the stock is 1.5...

A stock has an expected return of 12.66 percent. The beta of the stock is 1.5 and the risk-free rate is 5 percent. What is the market risk premium? (Answer in a percentage, but do not include the % sign and round to two decimal places, i.e., 18.35)

Stock a has a beta of 0.69 and an expected return of 9.27 %. Stock B...

Stock a has a beta of 0.69 and an expected return of 9.27 %. Stock B has a 1.13 beta and an expected return of 11.88 %.Stock C has a 1.48 beta and an expected return of 14.26%. Stock D has a beta of .81 and an expected return of 8.71%. Stock E has a 1.45 beta and an expected return of 15.04%. Which of these stocks is correctly priced if the risk free rate of return is 15.36 %...

. Using the information below, find the expected return and beta of the portfolio. Stock Beta...

. Using the information below, find the expected return and beta of the portfolio. Stock Beta Return Investment Stock A 0.78 7.55% $ 9,500 Stock B 1.10 9.87% $20,000 Stock C 2.45 15.66% $ 5,000 Stock D 1.00 10.22% $15,500

5) A stock has an expected return of 0.14, its beta is 0.94, and the expected...

5) A stock has an expected return of 0.14, its beta is 0.94, and the expected return on the market is 0.07. What must the risk-free rate be? (Hint: Use CAPM) Enter the answer in 4 decimals e.g. 0.0123. 6) You own a portfolio equally invested in a risk-free asset and two stocks (If one of the stocks has a beta of 1.77 and the total portfolio is equally as risky as the market, what must the beta be for...

A stock has a beta of 1.07, the expected return on the market is 0.11, and...

A stock has a beta of 1.07, the expected return on the market is 0.11, and the risk-free rate is 0.05. What must the expected return on this stock be? Enter the answer with 4 decimals (e.g. 0.1234).

A stock has a beta of 0.56, the expected return on the market is 0.06, and...

A stock has a beta of 0.56, the expected return on the market is 0.06, and the risk-free rate is 0.04. What must the expected return on this stock be? Enter the answer with 4 decimals (e.g. 0.1234). You own a portfolio that has $2,367 invested in Stock A and $5,423 invested in Stock B. If the expected returns on these stocks are -0.06 and -0.12, respectively, what is the expected return on the portfolio? Enter the answer with 4...

A. Alpha and the CAPM A stock with a beta of 0.77 has an expected return...

A. Alpha and the CAPM A stock with a beta of 0.77 has an expected return of 12% and an alpha of 1.5% when the market expected return is 13% . What must be the risk free rate that satisfies these conditions? 2.14% 2.13% 2.16% 2.15% B. Portfolio Beta An investor places $6,000 in Stock A, $5,000 in Stock B and $12,000 in Stock C. Stock A has a beta of 1.05, Stock B has a beta of 1.25 and...

Question